An early event of retinoic acid (RA) action to promote differentiation of embryonal carcinoma (EC) stem cells is to sensitize the cells to cyclic AMP by elevating cyclic AMP-dependent protein kinase (cAMP-PK) activities. PCC4(RA)-1 and Nulli (RA)-1 are mutant EC cell lines which fail to differentiate in response to retinoic acid. The former, but not the latter, lacks the cellular retinoic acid-binding protein (cRABP). Treatment of Nulli (RA)-1 cells (which possess cRABP) with RA provokes an increase in cAMP-PK activities and cAMP binding, whereas RA treatment of PCC4 (RA)-1 cells (which lack cRABP) does not cause an increase in cAMP-PK activity. These results suggest that cRABP may be required to mediate the RA-induced increase in cAMP-PK activities. Other studies have demonstrated that human psoriatic fibroblasts have little, if any, RII regulatory subunit when compared to R-II levels found with normal human fibroblasts. DEAE cellulose fractionation of extracts prepared from psoriatic fibroblasts also shows decreased type I cAMP-PK activity and the complete absence of type II kinase activity. The amount of the R-I regulatory subunit present in red blood cells obtained from psoriatic patients is significantly decreased compared to R-I levels in red cell membranes from normal subjects. These changes in R-I correlate with the severity of the disease, and indicate that determination of RI levels in red blood cells may be used as an index to establish the presence and severity of psoriasis. Human EC (Tera 2) cells in culture offer an in vitro system to identify possible hormones and growth factors which might play a role in regulating embryonic growth and differentiation. Results indicate that Tera 2 cells have insulin-like growth factor I (IGF-I) receptors present on the cell surface. Exposure of Tera 2 cells to RA leads to differentiation to a neuronal-like cell type which exhibits enhanced calcitonin stimulation, and somatostatin inhibition, of adenylate cyclase activity. These findings suggest a possible role for IGF-I, calcitonin, and somatostatin during embryonic development.